DFI Urging Borrowers to Be Aware
The Washington State Department of Financial Institutions is warning potential borrowers from payday loan offers that they see advertised on the web and on television. Many people who are seeking money for unexpected expenses are falling into borrowing traps that the DFI wants to prevent. Many of these lenders are not licensed lenders which could be a very risky and expensive mistake to make when borrowing money. THe DFI warns borrowers to read the fine print in any ad and contract before taking out a payday loan. The service you use should be licensed by the state of Washington. If it is not, then you should know that it is an unreliable lender.
Unreliable lenders can charge you extraordinary fees, outrageous interest rates and even make illegal charges against your bank account. When you take out a payday loan, you must provide confidential information such as your personal bank account information. THe DFI wants to protect borrowers by reminding them that without using a reliable source of payday lending, these companies have access to your personal information which can be devastating if used incorrectly.
For borrowers who are located in the state of Washington, it is important to know that the majority of internet based payday lenders are NOT licensed by the state of Washington. If you take a loan from an unlicensed payday loan lender, then the DFI has no jurisdiction in protecting the borrower whereas they would be able to protect you if you were working with a reliable and licensed payday loan lender. The DFI also does not have any power over the company to make it comply with the state’s laws because they are not licensed in the state and therefore, do not have to abide by such laws and regulations.
The DFI recommends that you verify the license of the lender you are interested in borrowing from. Then when you receive the contract, you should read through it carefully and fully. If you do not understand a part of the agreement, do not sign the contract until you are aware. Many unregulated and unlicensed payday lenders provide attractive deals which will catch your attention online and on television. However, no matter how attractive these deals may seem, in the end they will end up causing you much more debt and problems then a licensed payday loan lender.
